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Motley Fool Global Gains / GGM: Global Gains Philosophy


Subject:  Re: El-Erian: Buy more foreign stocks Date:  8/6/2008  3:04 PM
Author:  Hukphinn Number:  90 of 5166

Thanks for posting, Deej. Interesting stuff. I might have to check out his book (despite the fact that Greenspan rec'd it!).

Coincidentally, I've been working on an asset allocation strategy for my 401(k) recently (probably goes without saying that it's a fund portfolio). As of today (could change tomorrow!), I've come up with the following broad allocation:

52% US Stocks		
26% Large cap
26% Small and Mid-cap

30% International Stocks
15% Developed Markets
10% Large cap
5% Small cap
15% Emerging and Frontier Markets
12% Emerging Mkts
3% Frontier Mkts

18% Real Estate and Commodities
10% REITS and real estate operating companies (REOCs)
8% Broad-based commodities (via an ETF (DBC) and an ETN (DJP))

My working assumption is that the portfolios of US domestic stock funds include roughly 20-25% foreign stocks. If this assumption is true, that means roughly 40% of my allocation is US and 40% is international.

FWIW, I thought a 15% allocation to emerging markets was aggressive. I don't know many folks who would ratchet up their EM exposure to 33%.

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